Abstract: Structural changes in the global apparel industry have led to a new market environment in which part of the apparel channel members (specifically, apparel import intermediaries or AIIs) have had to assume new market responsibilities and have taken different approaches to their conventional functional activities. The purpose of this study was to investigate the basic nature of these firms' business operations, that is, the relationships among AIIs' capabilities, competitive advantages, and performance in the hyper-dynamic market environment of the apparel industry. In order to do so, this study (a) developed an integrative model of AIIs' capabilities, competitive advantages, and performance; and (b) conducted an empirical assessment of the model, using survey methodology.
Drawing from the first phase qualitative interview studies, extant theory, and literature in the strategy, marketing, and organizational management disciplines, the study proposed an integrative model of AIIs' capabilities, competitive advantages, and performance. A survey was developed to test the causal relationships of these three major constructs of interest. Subsequently, 807 firms were randomly drawn from ReferenceUSA, an Internet-based firm database that includes U.S. apparel manufacturers and wholesalers. Out of an adjusted sample of 736 firms, a total of 159 firms returned usable surveys, resulting in a 21.6% response rate. Structural Equation Modeling was employed for data analysis using LISREL 8.72 and tested the causal relationships among AIIs' capabilities, competitive advantages, and performance.
Overall, the study's findings supported the predicted positive impact between AIIs' capabilities of market interpretation, sourcing, and service and the competitive advantages of cost, product, and service. The results also supported the predicted positive impact between AIIs' competitive advantages and their relationship performance with domestic clients and foreign suppliers. Consistent with the resource-advantage theory of competition, the study supported the role of competitive advantages as the direct antecedents of AII performance and the role of functional capabilities as the indirect antecedents of performance. This study concluded with research contributions and implications, study limitations, and directions for future research